Sacks v. American Bonding Co.

HARRY SACKS, APPELLEE AND CROSS-APPELLANT, AND ALBERT J. HORAN, BAILIFF OF MUNICIPAL COURT OF CHICAGO, FOR USE OF HARRY A. SACKS, CROSS-APPELLANT,

v.

AMERICAN BONDING COMPANY OF BALTIMORE, APPELLANT AND CROSS-APPELLEE.

Appeal by defendant from the Circuit Court of Cook county; the
Hon. JOHN PRYSTALSKI, Judge, presiding. Heard in the first
division of this court for the first district at the April term,
1949. Reversed and remanded with directions. Opinion filed May 8,
1950. Rehearing denied May 22, 1950. Released for publication May
23, 1950.

MR. PRESIDING JUSTICE TUOHY DELIVERED THE OPINION OF THE COURT.

Rehearing denied May 22, 1950

This is an appeal by defendant American Bonding Company of Baltimore and a cross-appeal by plaintiff Harry A. Sacks from a judgment of the circuit court of Cook county in favor of plaintiff and against defendant in the sum of $23,842.72. The action is at law, on two replevin bonds and an appeal bond given in a replevin suit against Sacks in the municipal court of Chicago, for the wrongful suing out of the replevin writ and failure of the plaintiff therein to return the property seized, as directed by the judgment of the municipal court of Chicago.

The plaintiff in the replevin suit was Adeline Ogrodnik and the defendant was the present plaintiff Harry A. Sacks. The goods seized were so-called beauty supplies acquired by Sacks, a dealer, from the National Mineral Company (now Helene Curtis Industries, Inc., and hereinafter referred to by that name) for resale. Ogrodnik claimed title to the goods by virtue of an assignment dated December 8, 1944, from Helene Curtis Industries, Inc. This company in turn claimed title to the goods, asserting that the sale under which Sacks, a former employee, obtained possession was fraudulent and that the company had rescinded the sale. The plaintiff's right to possession was attacked by a motion to strike the pleading in the municipal court, which motion was sustained. An appeal was taken to this court and the judgment of the municipal court was affirmed (Ogrodnik v. Capron, 332 Ill. App. 138), the gist of the opinion being that Ogrodnik was not a bona fide assignee and consequently had no right to sue out the replevin writ.

The complaint here sets forth the judgment in the replevin suit, the failure of Ogrodnik to return the property, the two replevin bonds and appeal bond, and alleges that plaintiffs have been damaged in the amount of $38,000 plus interest. Ogrodnik, as an original party to this suit, being later dismissed out, filed an answer, amended answer and counterclaim.

The defenses set up on behalf of the bonding company, partly by adoption of Ogrodnik's pleadings, summarized, are: (1) a denial that plaintiff suffered the damages claimed  even assuming that Sacks had title and right to possession of the goods seized; (2) a denial that Sacks had title or right to possession of the goods replevied; and (3) the defense of recoupment, set forth in the amended counterclaim, alleging that Sacks was indebted to Helene Curtis Industries, Inc., in the amount of $19,168.04 for goods listed as sold and delivered to Sacks and not paid for, and that the claim was assigned by Helene Curtis Industries, Inc., on October 21, 1947, before the suit on the bonds was filed. The assignment, preceded by certain recitals (omitted here for sake of brevity), is as follows:

"Assignment.

In consideration of the foregoing and $1.00 paid by Ogrodnik to Assignor, Assignor confirms the assignment to Ogrodnik dated December 8, 1944, above set forth, and further assigns to Ogrodnik:

1. All and any rights, title and interest of Assignor in said merchandise or any part thereof not heretofore destroyed or disposed of.

2. All claims and causes of action that Assignor has, or except for this assignment would have, against Sacks for any of the following:

(a) For said merchandise or the value thereof or any part thereof;

(b) For the purchase price of said merchandise or any part thereof;

(c) Any and all other claims and causes of action against Sacks, similar or dissimilar to the foregoing, arising out of sale or delivery of merchandise to Sacks during the three-month period including October, November and December, 1944.

Executed under the seal of the Assignor, at Chicago, Illinois, October 21, 1947.

In support of the second defense paragraph two of the answer alleges that title and right to possession at the time of the seizure were in Helene Curtis Industries, Inc., and had passed to Ogrodnik, as assignee, by the assignment of October 21, 1947, after the replevin judgment; that said judgment did not adjudicate title to the goods; and that since Sacks had no title he was not damaged by the failure to return the goods and could not recover their value. The pleadings and judgment in the replevin suit in the municipal court are attached as exhibits.

The bonding company, by its plea set out in the third defense, seeks to offset the alleged debt of Sacks to Ogrodnik, its principal, against Sacks' claim. Written consent of Ogrodnik for such use of the claim appears ...

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